Everything you need to know about the UK’s 2025 employment law changes
This article explores the 2025 employment law changes in the UK, highlighting key reforms like stronger protections against unfair dismissal, the introduction of flexible working as a default, measures to address pay gaps, and new rights for employees and businesses alike. We will take you through how these updates aim to create fairer, more predictable, and inclusive workplaces.
Published:
26/11/24
Updated:
10/1/25
In this article:
The UK government is introducing what it describes as the biggest upgrade to employment law in a generation. With sweeping reforms aimed at improving job security, pay equity, and working conditions, these changes are set to impact millions of workers across various sectors. But what do these new laws mean for everyday employees and businesses? Let’s break it down.
Ending exploitative practices and strengthening worker protections
A key focus of the new reforms is to address long-standing challenges in the job market, from unfair dismissal rights to ensuring predictable work patterns. For too long, practices like zero-hours contracts and exploitative fire-and-rehire tactics have created instability for hours workers.
Under the new employment law:
- Unfair dismissal rights will be extended to all employees from day one, scrapping the previous two-year qualifying period. This means anyone can file an unfair dismissal claim if treated unfairly, without waiting to build up continuous service.
- Agency workers and those on hours contracts will now have stronger protections, including the right to move to a guaranteed hours contract after a 12-month period of consistent work.
- A new single status for workers will simplify employment categories, aiming to create fair pay rates and protect agency workers with the same employment rights as full-time staff.
Flexible working becomes the default
For many employees, achieving a balance between work and life has felt like an impossible task. To tackle this, flexible working arrangements will now become the norm unless employers can demonstrate that such requests are unreasonable. This represents a seismic shift in workplace culture.
The government has also strengthened flexible working requests, making sure that:
- Employers respond promptly, reducing the waiting period for decisions.
- Workers can make multiple requests within a 12-month period.
These measures are particularly important for carers, parents, and those in the social care sector, where rigid schedules have often led to burnout.
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Fair pay and tackling inequality
With the rising cost of living, ensuring a genuine living wage for all workers has become a priority. The reforms include significant changes to address income inequality and promote fair pay:
- The introduction of national terms for service charges, so that hospitality workers retain 100% of tips.
- Removal of earnings limits for statutory sick pay, providing more support for low-income workers.
- The creation of a duty for employers to address pay disparities through mandatory ethnicity and disability pay gap reporting.
Support for marginalised workers
The reforms prioritise inclusivity, with specific protections for ethnic minorities, disabled workers, and those engaged in trade union activity:
- Mandatory ethnicity pay gap reporting will become a requirement for large employers, alongside efforts to reduce disability pay gaps.
- The government is repealing restrictions on trade unions, introduced by the previous government, to restore trade union rights and strengthen the ability of unions to advocate for workers.
Additionally, stronger protections will be provided for those involved in constructive dismissal cases, making sure that individuals leaving toxic workplaces can still access justice.
Enhancing employee rights and probation standards
To ensure fairness from the start, the government is introducing a statutory probationary period for new hires. While this allows businesses to assess suitability, it guarantees that employees have rights from day one. The changes include:
- A new code of practice outlining fair treatment during probation periods.
- Enhanced redundancy protections for employees dismissed within their probationary period.
For existing employees, these reforms also address contractual terms, requiring transparency and clarity in every contract of employment.
Boosting protections in the workplace
Workplace harassment has been a persistent issue, particularly for women and marginalised groups. New measures will mandate a proactive approach:
- Employers will have a duty to take reasonable steps to prevent sexual harassment.
- A statutory code will offer clear guidance, making sure that workplace policies reflect best practices.
These reforms also reinforce protections for pregnant employees, so that they cannot be dismissed during pregnancy or in the six months following their return from leave.
Simplifying enforcement and improving accountability
One of the standout features of the reforms is the creation of a single enforcement body, which will consolidate various agencies responsible for upholding employment laws. This body will:
- Oversee issues like holiday pay, minimum wage violations, and the abuse of agency workers.
- Simplify the process for workers to bring cases to employment tribunals.
The government will also rely on secondary legislation to adapt laws quickly to the changing needs of the workforce, ensuring that employment rights keep pace with the modern economy.
New rights for modern work patterns
Recognising the realities of today’s workforce, the reforms address challenges faced by those in gig work, hospitality, and retail. Measures include:
- A right to a predictable work pattern, ensuring stability for those on low or irregular hours.
- A “right to switch off,” preventing employers from contacting workers outside designated hours, except in emergencies.
These updates reflect an acknowledgment of the blurred boundaries between work and personal life in an increasingly digital world.
Trade unions and collective rights
The government’s commitment to a fairer workplace extends to restoring the role of trade unions in advocating for workers:
- Anti-union legislation from the previous government, including the controversial Minimum Service Levels Act, will be repealed.
- Employers will face stricter penalties for interfering with trade union activity.
By supporting unions, the reforms aim to give workers a stronger voice in shaping their employment conditions.
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Sector-specific support
The reforms acknowledge the unique challenges faced by certain industries, like the social care sector:
- Measures to address staffing shortages include stronger protections for employees and a renewed focus on recruitment and retention.
- Plans to implement a genuine living wage for all workers in the sector, ensuring fair compensation for demanding roles.
So what’s next for employment law?
While the 2025 reforms represent significant progress, the government has signalled its commitment to ongoing improvement. Future initiatives include:
- A review of flexible working rights, with a focus on extending these benefits to more employees.
- The potential introduction of a single worker status, further simplifying employment classifications.
- Expanded codes of practice to cover emerging workplace challenges, making sure that businesses and workers can navigate these changes effectively.
Why these reforms matter
The UK’s labour market is evolving, and these changes are a reflection of the need for a fairer, more inclusive system. By addressing long-standing issues like low pay, harassment, and job insecurity, the reforms aim to create a workforce that is not only more productive but also happier and healthier.
For employers, these changes are an opportunity to build trust, improve retention, and create a positive workplace culture. For employees, they signal a future where work aligns more closely with life’s realities.
This transformation of UK employment law underscores a shared commitment to building workplaces that work for everyone. Whether you’re an employee or an employer, these changes are set to redefine what fairness at work truly means.
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Book in a call with a member of the team and discover how we help organisations create more positive, inclusive and healthy workforces
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Book in a call with a member of the team and discover how we help organisations create more positive, inclusive and healthy workforces